Sales activity increase led by lower-priced homes

City of Calgary, September 3, 2019–Increased sales and easing new listings reduced housing inventories in August. Sales were primarily driven by homes priced below $500,000.

“Employment numbers have been improving, but mostly in industries that are traditionally lower paid,” said CREB® chief economist Ann-Marie Lurie. “This is contributing to the shift that we are seeing in the housing market, with growth being limited to product priced below $500,000.”

Rising sales for homes priced under $500,000 offset sales declines in the higher price ranges. This caused August sales to improve by six per cent compared to last year.

Sales activity improved for all product types. The growth was largest for apartment-style and attached properties.

Attached sales increased for the sixth consecutive month compared to the previous year. This is also the only property type with year-to-date sales higher than last year’s levels.

New listings continued to ease this month, which caused inventory to decline. This is helping the market shift toward more balanced conditions.

The amount of downward pressure on prices is also easing. At $426,000, the unadjusted citywide benchmark price this month remained comparable to last month, but 2.6 per cent lower than last year’s levels.

Despite improving sales and reductions in inventory, housing market recovery will take time. Inventory levels remain elevated and sales activity is still well below historical norms. The market continues to favour the buyer, with over four months of supply.

Detached

•Year-to-date detached sales remain just below last year’s levels, but sales improved in the South and North West districts this month.

•Citywide growth has been driven by homes priced under $500,000. Meanwhile, easing sales and elevated inventories among homes priced above $500,000 have increased the months of supply, pushing it further into buyers’ market territory.

•Benchmark prices in August ranged from a year-over-year decline of over five per cent in the South district to a decline of nearly one per cent in the South East.

Apartment

•For the second month in a row, sales activity improved for apartment-style homes, but these gains were met with a rise in new listings. This prevented any significant adjustments to inventory levels and kept the months of supply elevated.

•Sales activity remains just below last year’s levels. On average, the amount of inventory in the market this year has eased compared to last year.

•Citywide benchmark prices in August eased compared to last year, but the East, South East and North East districts recorded modest gains. Despite those gains, prices remain well below 2014 highs.

Attached

•For the sixth consecutive month, year-over-year attached sales improved in the city. This has resulted in year-to-date sales of 2,665 units, nearly a five per cent increase compared to the previous year. At the same time, new listings continue to ease, causing further reductions in inventory.

•The months of supply have moved from over six months at this time last year to under five months in August.

•These improvements have supported some monthly gains in benchmark prices, but August benchmark prices remain 2.6 per cent below last year’s levels.